| The Wireless
Advantage and Offshore Investments |
|
| In the
21st century, high technology will deliver constantly increasing advantages
to those smart and lucky enough to be doing business offshore. |
|
| There are
tremendous opportunities for investors and vacationers in developing and
emerging countries that are ready to benefit from the wonders of "Bypass
Technology". |
|
| The
next generation of high-technology infrastructure is ideally suited to
the developing world. |
|
| The wonders
of the wireless world give offshore haven countries the ability to bypass
today's state-of-the-art American technology infrastructure of telephone
lines and TV cables and leapfrog directly into the emerging global network
of networks. |
|
| Many emerging
or third world countries are rich in natural resources, land,
minerals and a cheap labor pool, but have not had the technology or financing
to develop the infrastructure needed for major undertakings like utilities,
telecommunication systems and financial services, until very recently. |
|
|
|
|
| Countries
like Belize, Honduras and Costa Rica haven't been able to build a
national telephone system using pre-satellite technology, which required
a major investment in cable and equipment, but now, they will soon
be able to provide every resident and visitor with a digital cellular
phone for a fraction of the cost of the conventional wired telephone
systems that requires a huge investment in infrastructure, manpower and
capital financing. |
|
| With this
new technology, which is being installed simultaneously with the graying
of America, many of the emerging countries around the world are becoming
the retirement home of choice for baby-boomers, as well as for the world-travelers
among our Expatriate community. |
|
| Why? Let me
count the ways! |
|
| Lower Cost
of Living |
|
| The primary
promise that brings new residents to third world countries is the ability
to live on a fraction of what it costs in the more developed (and therefore
more highly taxed) countries of the world. |
|
|
| Fortune
Magazine reported in 1998 that over 600,000 American have become Expatriates.
They just want to maintain their lifestyle or get away from a society that
does not meet their lifestyle expectations or provide the most conducive
atmosphere for achieving their financial goals. |
|
| Most Americans,
"the poorest retirement savers in the world", approach retirement
with the shocking realization that they will have to live on the meager
benefits allotted by social security. Even those who can supplement
this pittance with an IRA, 401K, or company retirement plan often fall
far short of their goals. |
|
| How will
they be able to maintain the lifestyle to which they have become accustomed?
Could you live on $1000 per month, tomorrow, if you had to? Could
you even do it on $2000? If you live in the US, Western Europe or
Australia, fat chance! But if you take that same money (as shrewd $50,000
a year retirees in Guadalajara have done) and emigrate south to Mexico,
Belize, Honduras or Costa Rica, you can do just fine, thank you! |
|
| The Central
American Growth Boom |
|
| In recent
years, Central America has become to baby-boomers what Florida, California
and Arizona of the 1950's were to the World War II generation.
Remember when you could BUY beachfront property in Florida for a
song? When prices in California were DIRT CHEAP? Well, those
days are now in full bloom just a little further south of the border.
The slower paced countries of Central American have awakened to the realization
that they can revitalize their economies, ravaged by the long years of
the Cold War, by becoming the retirement center of the western world. |
|
| All of the things that made Florida
and California boom are now happening in Belize, Honduras and Costa Rica.
The preconditions for such a boom are starting to emerge in Nicaragua,
Panama, El Salvador and Guatemala. |
|
|
|
|
1. Cheap
real estate
2. Sunny
weather
3. Lower
cost of living
4. Low
taxation
5. Inexpensive
medical care |
|
| As more
and more Americans Europeans and Canadians face the challenge of retirement,
we
are seeing an exodus of retirees to sunnier shores. If you look closely,
you will find that the Europeans are right there too, especially
in Costa Rica and Cuba -- the next sure-fire real estate development in
the Caribbean. |
|
| As I sit
here, writing this article in Hawaii, I look around and see the future
of development in Central America. The hotels, retirement communities
and resorts surrounding me were just a dream in the 50's and 60's when
I first came here as a soldier. Today, well, you know the story!
You try to buy a piece of the rock in Hawaii. |
|
| The lower
cost of living is the lure that attracts the outside world to the emerging
countries. It will also be the fuel that feeds their growth and development,
creating tremendous investment opportunities as well. |
|
|
| Quality
of Life |
|
| If you have
ever spent an hour on the freeway driving to and from work (do it every
day, do you?) or waited in line behind an army of screaming shoppers,
you know the frustration and anxiety of what our "advanced" civilization
can bring to your life. |
|
| Wouldn't you
rather spend that time walking on a pristine beach or staring at a beautiful
sunset, sipping on a Cuba Libre or a Pina Colada? |
|
| You can,
you know. And it's a hell of a lot less stressful, let me tell you. |
|
| Because of
that, you will probably live longer, as well as enjoying it more. |
|
| Consider
that the average life span in Costa Rica is 76 years. That's four years
longer than in the US! And that longer lifespan is achieved without
heart surgeons, super drugs or so many face lifts that you need to wear
a goatee! |
|
| Nine out
of ten people that go to Central America to retire stay there and die there.
This is a clue! You couldn't drag them back with a Caterpillar! |
|
|
|
|
Contrary to
what you think you hear in the media, crime (especially violent crime)
is lower in Central or South America than it is here in the US. (We
are probably the most violent society in the world). Every since
Russia went broke and quit sending Castro money to finance his "revolutionary
ways", the guerilla wars have vanished and democracy is the word of
the day. Yes, there is still a lot of petty crime but the gangs, with their
drugs and guns, don't own the
streets. |
|
| Nicaragua,
once the hotbed of discontent in Central America, now has a democratic
government and is actively soliciting retirees and investment capital.
International Living now rates Nicaragua as a "strong buy" and conducts
exploratory tours that expose tourists and investors alike to the exciting
opportunities in real estate and commercial development there, as well
as the ability to "live like a king on $1000 per month" in one of
the least costly countries in the world. |
|
| Asset Protection
/ Liability Avoidance |
|
| If you make
the big bucks and want to keep them, or if you plan to get there someday,
that's another reason to consider the lure of offshore. |
|
|
| Many of
the Caribbean Islands and several mainland governments, such as Panama,
Belize and Costa Rica have seen the light. They are securing their
economic future by offering wealthy investors and high-risk entrepreneurs
the ability to shelter their assets and lower their taxable income through
financially friendly trusts, corporations, banking institutions and government
legislation. |
|
| If Leona
Helmsly had set up her business empire through an offshore holding company,
the
IRS would not have had a prayer of putting her in jail. |
|
| Why?
Because, they wouldn't have been able to touch those incriminating documents,
they wouldn't have been able to trace her financial transactions beyond
the US and, if she had taken citizenship from one of these friendly financial
havens, they wouldn't even have had jurisdiction over her body.
(Sorry Leona, see me when you get out). |
|
| Tax Avoidance |
|
| When set up
properly, offshore financial planning can minimize personal or corporate
tax liability and even give substantial tax breaks that do wonders for
the bottom line. |
|
|
|
| Years ago,
ten of us invested in a $750,000 yacht that threw off a five to one tax
loss and gave us free use of its services in some of the best Marlin fishing
ground in the world. Now, that was a deal! |
|
| Consider
that the average life span in Costa Rica is 76 years. That's four years
longer than in the US! And that longer lifespan is achieved without
heart surgeons, super drugs or so many face lifts that you need to wear
a goatee! |
|
| Nine out of
ten people that go to Central America to retire stay there and die there.
This is a clue! You couldn't drag them back with a Caterpillar! |
|
| So how
do you do it? Is it really that easy? One way to take a chunk out of
your taxes is to declare your primary residence in a foreign country and
live (more than 181 days per year) outside your former home country
and earn your income internationally (through a foreign corporation
that you own or work for). All the big rock stars have done this
for years. |
|
| When you
follow the government's guidelines, you can legally deduct the first
$70,000 of your income, your spouse's income, your children's income, etc...
and the rest of the money, well that stays in the corporation in a tax
free zone. Get the picture, Vern? How do you think all of the
doctors and engineers that work in Saudi Arabia got so rich so quick? |
|
| You want
to still play in the market, managing money or day trading? Look at
Mark Mobuis and see how he did it. Mobuis gave up his US citizenship
(and with it, responsibility for paying his mult- million dollar tax
bill) and graciously accepted Bahamian citizenship, not missing a stroke
in his business. His clients are happier than ever, because their
money is now offshore, too. |
|
| Another
asset is the ability to sleep at night and know that neither the government
nor civilian creditors can tie up your assets through liens, judgments
or litigation, if you move them
before you suffer or contemplate
financial business problems. |
|
|
|
|
| By making
sure that your offshore planning pre-dates your liabilities, your assets
can be "bullet proof" against the courts, lawyers and litigants
alike, simply by moving assets into offshore asset protection vehicles
customized to your specific needs. |
|
| NOTE: Don't
buy one of the "out of the box" trusts or IBC's and expect it to
meet all of your desires. Spend a few extra bucks and get a tailored
program in a jurisdiction best suited to your needs and requirements. |
|
| If you need
help and don't know where to go, click on www.hideyourassets.com for free
resources and ideas. |
|
| Ground
Floor Business Opportunities |
|
| Through
the wonders of magic technology, we can now have our cake and eat it
too. We can reside in Honduras, invest in the US and Europe and bank
in the Isle of Mann, if we want to do so. |
|
| We can live
in an emerging country offering substantial financial benefits and still
day trade, videoconference and watch our CNBC and Moneyline. With
the help of "BypassTechnology" such as satellite systems and digital
cell phones, we can literally be or live anywhere in the world and conduct
our affairs when, where and how we see fit. |
|
| How about
jobs? Employment and business opportunities are waiting for the taking! |
|
| When you
put an entrepreneur with proven sales skills and management abilities in
a country rich with natural resources and technological needs - good things
can happen. Many opportunities that we often take for granted, McDonalds,
movie theaters, mini-storages and coin laundries are begging to burst on
the scene in emerging countries. |
|
| With a small
investment in real estate and construction you could quickly become the
mini warehouse mogul of Belize, Costa Rica or any one of a dozen similar
countries. |
|
| Every successful
US product manufacturer and distributor wants and needs sales reps who
can do business in rapidly growing third world marketplaces. |
|
| Speaking
the language is a plus, but not always necessary as English is the
language of business around the world. |
|
| What do
they need? Valves, pumps, washing machines telephone systems, filtration
systems, satellite dishes, computers and any other product of state of
the art technology. |
|
| The market
is wide open and the need is there. Go look at the international
want ads and see what I mean. They even need stockbrokers and investment
advisors to meet the needs of a growing investment community of retirees. |
|
| Last but not
least, US business is migrating to the suburbs. Intel has opened in Costa
Rica, Barclay's Bank and Citibank smile in Belize, and the hotel industry
is expanding everywhere! |
|
| Real Estate |
|
| One of the
best, if not the best offshore investment opportunity is
in the purchase and sale of real estate. |
|
| The market
in the Caribbean and Central America is red hot and has been the best kept
investment secret in the world for years. |
|
| Consider
that: real estate in Costa Rica has risen 500% in five years.
Honduras is right behind, with Claudia Schiffer, Julia Roberts, Sylvester
Stallone and half a dozen other movie mavens building retreats on their
shores. The government of Belize will even donate (on a long term lease)
a matching acreage in real estate if you buy land, develop it and employ
the locals. |
|
| Central
America, being both mountainous and having water frontage on theAtlantic
Gulf Coast and Pacific Coast oceans has a great variety of climate temperatures
and spectacular views, for just pennies on the dollar compared to its US
counterpart. |
|
| You like
San Diego? Consider San Jose, Costa Rica. If Denver is your dream,
but a bit warmer, then the valley of the Angels in the Honduras highlands
is for you. If you were an alligator in a previous life -- a sun
and water loving creature -- Belize and the island of Roatan is your paradise. |
|
| In all
but the major cities, land can be bought in the mountains and highlands
from $1000 to $5000 per acre, ocean views for $10,000 to $30,000 per acre
and beachfront for $50,000 per acre or more. If you buy in volume,
say in the 10 to 50 acre parcels, the prices drop and make a fine investment
through subdividing into lots that will often double your value as soon
as the first for sale sign is put up. |
|
| If you missed
out on the boom in Costa Rica, and Honduras is a little pricey for you,
there are still rock bottom opportunities in Nicaragua and Guatemala. |
|
| Five years
from now, I expect these prices to be up substantially with returns
that any stock market would be envious of. This is an investment
you can hold in your hands! |
|
| Lower Taxes,
IF... |
|
| You can avoid
many of you taxes and defer much of your income, if
you follow the rules religiously. Tax avoidance is perfectly legal
and many are the ways to shave points through trusts, annuities, and International
Business Corporations (IBC's). |
|
| Trusts can
help their founders avoid probate, capital gains and certain income taxes. |
|
| Annuities
can defer income from high earnings years to retirement and dramatically
lower their owner's income tax bracket. |
|
| Corporations,
domestic and foreign, can hold and own assets in their own right and
pay expenses that would otherwise be wasted on post tax dollars from an
individual return. Foreign corporations (IBC's) are taxed
less than US based companies and have other advantages such as privacy
and asset protection from nosy lawyers and their courts. |
|
| The key
to minimization is proper planning. A good plan may sound Greek
to you, but imagine what it sounds like to the IRS! If you can lower
your income tax bracket two notches, bulk up your retirement through tax
deferred investments and perfect inheritance taxes lurking in probate court,
the results make the difference between retiring and runny dry. |
|
| Don't be fooled
into buying a trust or IBC in a box, it's nothing but a shell until you
breathe life into it through funding and management. |
|
| All in all,
there are many advantages to using the offshore advantage. But, there
are more than a few potential liabilities and dangers as well. The sage
phrase "Let the buyer beware" applies here in spades. |
|
| Lurking
in the sultry offshore waters are many varieties of sharks and barracudas,
little ones, big ones and some real monsters! Most of these slimy
fishes are expatriate Americans, who in their former lives were insurance
or used car salesmen and now are masters of international investment.
These money mavens often live offshore because they have to, not just because
they want to. |
|
| There is a
saying in Costa Rica, "The best way to save $1.000,000 in Costa Rica,
is to come there with $2M. Soooo!," you have to watch your wallet,
especially when it comes to high finance and investments. |
|
| In my next
article, "Fleecing the Sheep", we will go into the underbelly of
the investment world, from Ponzi to the present day purveyors of
exotic investments, to sniff out the good, from the bad and the ugly! |
|
| So, is this
for you? Are you ready to venture out? Check It Out! |
 |
|
|
